ETFs buck redemptions trend
The exchange-traded fund (ETF) sector grew by $25 million in September, reversing a month of net redemptions in August, according to the BetaShares Australian ETF Review for the month ending 5 October.
The ETF industry saw outstanding units grow by 1.5 per cent in September, equating to $25 million in "new money", according to BetaShares.
However, the market capitalisation of the ETF sector declined by $272.6 million (or 5 per cent) in the last month due to a downturn in local and global stockmarkets. The overall market capitalisation of the Australian ETF sector was $4.9 billion as of 5 October.
The global market volatility is seeing investors continue to take up gold ETFs as a safe haven. The gold bullion ETF (GOLD) is the second largest Australian ETF by market capitalisation, standing at $712 million as of 5 October.
Trading volumes on international and currency ETFs are still proving popular, suggesting investors are "taking a view on the local fundamentals weakening", according to the review.
BetaShares head of investment strategy Drew Corbett said investors were looking to products that benefited from a weakening in the Australian market.
"While still maturing, the suite of ETFs available for investors continues to expand, allowing investors to benefit from a variety of market conditions," Corbett said.
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